The university plans to construct a 13,050 square-foot addition and 7,990 storage yard for the Steady Thermal Aero Research Turbine, or START, Lab.
The "psu" and "roomgear" networks will be retired June 30.
The festival will be relocated to the Porter North lot due to ongoing construction of Beaver Stadium.
A group of around 60 protested for an hour at the Allen Street Gates.
$2.5 million will go to Invent Penn State, while $500,000 will go to stadium renovations.
Thousands of West Penn Power customers in Centre County were without electricity on Sunday into Monday morning as heavy storms caused downed trees and power lines.
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